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Society, State and Market
A guide to competing theories
of development .
About the Author
Professor John Degenbol Martinussen has had a distinguished career in
development studies. He is currently study director for International
Development Studies at Roskilde University in Denmark. He is also a former
chairman of the Danish Social Science Research Council and a former
president of the Danish Association for International Cooperation
(Mellemfolkeligt Samvirke). He is currently chairman of the Council for
International Development Cooperation in Denmark.
Over the years he has acted as a consultant to various international
organisations, including the JJNDP. South and South East Asia have been
his primary geographical regions of specialisation and his research interests
revolve around, inter alia, a reappraisal of the role of the state in develop­
ment, as well as appropriate methodological approaches and the growth of
theory in development studies.
His recent books in English include:
JOHN MARTINUSSEN
Pluralism, Competition and Choice: Emerging Local Se!fGovernment in Nepal, New
FU ;2':·>;) Fi:' . '.J:."1~ ·"l,:'l
I"~ '~'l
Delhi: Sage Publications, 1991.
j' ,
The Theoretical Heritage from Marx and weber in Development Studies (edited),
Roskilde: International Development Studies, 1994.
Nem international Economics and their Applicabiliry in a Third World Context
(edited); Roskilde: International Development Studies, 1993.
Transnational Corporations in a Developing Country: The indian Experience, New
Delhi: Sage Publications, 1988.
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PRETORIA
Sode{y, Slale nnd Mnrkel: A gllide 10 fO/hpetillg tbeories ofdetle/op/Ile111 was nrst pub­
lishcd in English hy ZeJ Books UJ, 7 Cynthia Street, LonJon N 1 9)1', UK,
and 16\ First Avenue, Atlantic HighlanJs, New Jersey 077,6, USA, in 1997·
Contents
Published in Canada hy FernwooJ Books LtJ, PO I\ox 9409, Station A, Halifax,
Nova Scotia, CanaJa, n 3 K
\ \
3·
Published in South Africa hy Human Sciences Research Council, PO Box \ \ j6,
Pretoria 000 J.
Originally puhlisheJ in Danish under the title Sall/jillld, stat ogIllarke": EI/ k/ililk
gemwlIgtllJ,g, a/leoder 0/11 IIdlJik/ilig i deu], ierde» hy Mellem folkeligt Samvirke,
BorgergaJe 14, DK 1300 Kohenhavn K, Denmark, in 199\·
List of Tables and Figures
Preface
Copyright © Mellemfolkelib>t Sarnvirkc, 199\
Copyright © John Mar rinusscn, 1997
Translation and revision © John Mnrrinusscn, 1997
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Introduction
Development Studies as a Subject Area
A catalogue record for this hook is available from the British Library
Lihrary of Congress Cataloging-in-Puhlication Data
2
Martinusscn, John.
,
ISamfunJ, stat og marked, Englishl
State, society, and market: a guiJe to competing theories
of Jevelopment I John Martinusscn.
r­ em.
1ncludes hihliographical references and index.
1SRN 1-8j649-441-1 (hb). -1SRN 1-8\649-442-X (ph)
I. Developing countries-Economic policy.
2. Development
cconomlcs-e-Dcvcloping countries. ,I. Developing countries­
-DepenJency on foreign countries. 1. Title.
HCj9·7· M 126 1997
33 8.9'009 '7 2 '4--<.10 0
96- 24 00 j
Conceptions and Dimensions of Development
Marrinusscn, John.
Society, state and market
Includes hihliographical references and index,
1SRN 1-89\686-72-j
1. Title.
I. Economic dcvclopmcnr.
~
18
34
Economic growth /35 Increased welfare and human
development 137 Modernisation 138 Elimination of
dependency /39 Dialectical transformation /40
Capacity building and development by people /41
Sustainable development /43 Development and security /44
Development as history /4l
CanaJian Cataloguing in Publication Data
1 85649 441 1 hh
1SRN 1 85649 442 x ph
South Africa 1SRN 079 69 '795 7
Canada 1SRN 1 895686 7' 5
The Theoretical Heritage and Controversial Issues
in Development Research
Theoretical origins of development economics /19 Theoretical
origins of sociological and political developrnent theories /2l
Major controversial issues in development research /30
C1P
1SRN
3'
What is development research? /3 Development research
is more than economics !5 Is there a crisis in development
research? /8 Does the Third World still exist? /8
The method of analysis /1 2 The structure of the book / I 6
The right of John Martinusscn to he identified as the author of this work has been
asserted hy him in accordance with the Copyright, Designs and Patents Act, 19 88.
118·9
Xl
PART I
Cover designed hy Andrew Corbett
Set in Monorype GaramonJ hy Ewan Smith
Tansfcrred to Digital Printing in 200 7
House, Kenner \'(fay, Trowbridge, Wilts nA 14 8ltN
1-lD75· M17 '997
x
PART I I
4
Economic Development and Underdevelopment
47
Major Theoretical Currents in Development Economics
49
The emergence of competing schools of thought /,o
Different perspectives on economic development /F
THEORETICAL HERITAGE AND ISSUES
19
from which contemporary development research has drawn considerable
inspiration.
CHAPTER
2
The Theoretical Heritage and
Controversial Issues in Development
Research
Studies of Third World societies date back to the earliest European colonisa­
tions of Latin America, Asia and Africa. A large number of these studies,
however, at least up to the middle of the nineteenth century, were so
preoccupied with the unique that one must describe them as atheoretical and
ideographic. Their aim was not to identify patterns and general determinants
of people's behaviour and societal development, but rather to describe local
conditions without a theoretical framework, without a systematic comparative
perspective, and without trying to generalise. Consequently, studies of this
kind did not form schools of thought for method and theory construction.
It should be added, though, that in much of the historical writings about the
colonies, and in many of the older ethnographic and socio-anthropological
descriptions, one can find a wealth of detailed information which. has since
been used extensively for re-analyses within subsequently elaborated theor­
etical frameworks.
Methodologically conscious and generalised approaches to studies of
societies emerged primarily in Europe, and in connection with studies
of European societies, rather than their colonies. It is these approaches that
form the major part of the theoretical heritage of present-day development
research and theory construction.
Development research embraces, as was stressed in the previous chapter,
many social science disciplines and additional elements from the humanities,
in particular. The delineation of disciplines, like economics or political science,
is of recent date. The breaking-up of all-embracing society studies into mono­
disciplinary studies came about only in the twentieth century, primarily in the
period following the Second World War. This specialisation did not character­
ise the earliest and school-founding theorists of the nineteenth century. None
the less, it is a characteristic of the modern disciplines that each has
reconstructed its own theoretical heritage with emphases assigned to particular
classical theorists. Therefore, it will be appropriate to divide the present
review into at least two main streams of thinking: development economics
and socio-political development theories. These are the two major traditions
18
Theoretical origins of development economics
Development economics first appeared as a distinct subject area during the
1940S and the beginning of the 1950S, concurrently with the political de­
colonisation of Asia, the Middle East and, later, Africa. The main interest of
development economics was from the outset to uncover the causes for
continued poverty and underdevelopment or stagnation in the Third World.
At the same time, the emerging analytical perspective drew attention to the
opportunities and preconditions for economic growth in the former colonies.
Hence, from the very outset close linkages were established between theory
and strategy.
Development economics emerged as a special perspective and later as a
sub-discipline within the field of economics. The focusing of development
economics on the sources of, and obstacles to, long-term economic growth
separated the subject area from the neo-classical mainstream which, since
the turn of the twentieth century, had been increasingly taken up with short­
term economic equilibrium analyses and maximising of efficiency in resource
allocation.
However, economics in general as well as development economics have
common roots in the so-called classical political economy of the eighteenth and
nineteenth centuries, represented primarily by Adam Smith (172.3-179°),
Thomas Robert Malthus (1766-1834) and David Ricardo (1772.-182.3). To
this group could later be added John Stuart Mill (1806-1873)'
<Adam Smith placed himself at the centre of the debate towards the end of
the eighteenth century with his major work, Wealth of Nations (1776). In it he
underlined the critical role of the market mechanisms, operating - as it later
became known - as 'the invisible hand' which ensured that production in
society was (in most cases) or-ganised in the best interests of all. Smith's
central argument can be summed up in one sentence: there may be producers
who will try to sell inferior goods at high prices, but if the producers are
competing they will all eventually be forced to deliver proper goods at
reasonable prices.
Another important role the market played, according to Adam Smith, was
that of a growth source. The reasoning in this context was that when the
market expanded as a result of population growth or territorial expansion
(expansion of the British Empire), then demand would increase and pro­
duction grow as a response to that. At the same time, specialisation would
increase among the producers. This was a central element in Smith's theory
of growth; he argued that specialisation would in itself, for a number of
reasons, lead to higher productivity per working hour. A major precondition
for this was an increased accumulation of wealth - which had to come from
INTRODUCTION
THEORETICAL HERITAGE AND ISSUES
the rich, especially the industrialists and their profits from productive in­
vestments. The accumulated funds were required for investment both in
more working capital (to ensure employment of additional workers), and in
mote fixed capital (to increase mechanisation). It followed from this argument
that the emerging industrial sector should be considered as the most dynamic
one and as the one on which to base aggregate growth. This proposition
contrasted with that of the French physiocrats who earlier in the eighteenth
century had argued in favour of agriculture as the main engine of growth.
Adam Smith's idea about 'the invisible hand', as well as his hypotheses
about accumulation and investment of profits as the most important
determinants of economic growth, have played prominent roles in the debates
ever since his time. The notion about the 'invisible hand' has been central
in the debate about attaining equilibrium and in relation to the state-versus­
market controversies (cf. Chapter 18). The theses about sources of growth
have similarly had a strong impact upon discussions about causes of long­
term growth. Since Smith's original theories were formulated, numerous
refinements and qualification have been added, but it is remarkable that
some of his basic notions can still be identified as core elements in the
debate even after the Second World \'Var.
Daoid Ricardo was one of the first who seriously elaborated on Smith's
classical political economy, especially with a land-rent and distribution theory
and with the theory of comparative advantages. Regarding the former, it
should be mentioned that it has heavily inspired contemporary theories
concerning the relationship between agriculture and industry. It enabled
Ricardo to identify two other sources of growth in addition to capital, namely
technical innovations and international trade.
\'Vhen Ricardo suggested more sources of growth than did Adam Smith,
this was not the result of a more optimistic view. On the contrary, Ricardo
was fundamentally pessimistic regarding long-term growth because his
analyses led him to conclude that continued population growth and the
corresponding increase in demand for food would result in the inclusion of
all land for agricultural production - even the so-called marginal land with
very low area productivity rates. Utilisation of poorer and poorer land would
cause the land rent to go up, mainly due to the farmers' competition for the
better, temporarily more profitable, land. This process would result in a
redistribution of national income to the benefit of the landed aristocracy,
but to the detriment of the industrialists. Simultaneously, the marginal costs
in agricultural production would rise with the increased cultivation of marginal
land. Food prices would then increase, leading to stronger pressure on wages
which would, in turn, cat into the profits of the industrialists from another
side. The final result would be a squeezing of the industrial profits to zero,
whereby the whole foundation for economic growth would disappear. Only
technical innovations and international trade could, according to Ricardo,
prevent this sad outcome.
The theory of comparative advantages was elaborated in continuation ~f
the above argument as an attempt to evolve the best possible policy for
foreign trade. The basic notion was that each country should concentrate its
production in areas where it had comparative advantages in relation to other
countries with respect to the productivity of its workers. In accordance with
this basic thesis, non-industrialised countries such as Portugal should refrain
from trying to build up industries and, instead, continue to concentrate on
the production of, for instance, wine. Industrialised countries like England,
on the other hand, should produce and exchange industrial products such as
textiles and clothing.
With these and many other notions, and the accompanying chains of
reasoning, Ricardo came to inspire both Karl Marx and later neo-classical
economists. Ricardo is one of the very few theorists who has enjoyed
widespread and great respect within both the Marxist and the liberalist
traditions.
Thomas Robert Malthus is known primarily for his pessimistic theses on
population growth. He believed that the population would grow markedly
faster than food production, if it was not constrained, with the poor in
particular breeding rapidly. There would be little reason for mentioning
Malthus in this context had he not come to function as a reference point in
post-war debates on population problems (ef. Chapter II). Very few re­
searchers in the twentieth century have taken Malthus's exact formulations
of the progression in population growth and agricultural output seriously.
However, his basic assertion that population will necessarily grow more rapidly
than agricultural production has played a central role as a hypothesis that
many researchers have taken a position on, either positively confirming or
negatively dismissing it.
From a certain point of view, it would be just as appropriate to mention
Malthus's contribution to the formulation of an economic crisis theory, which
stretched far beyond the thesis of population growth as a prime barrier to
economic growth. This contribution could in many ways be seen as a
forerunner of Keynes's more elaborate crisis theories of the 1930s.
Jobn Stuart Mill should be briefly mentioned before we leave the classical
political economists, not so much because of his new and original contribu­
tions to theory construction, but more because he reviewed and commented
on the then existing theories in a widely disseminated book, Principles oj
20
21
Political Eco"omy (1848).
Common to all the classical political economists was a strong emphasis
on generalisation and abstraction. In their analyses, they searched for patterns,
causal relationships and laws of motion regarding societal conditions in the
short-term perspective, as well as regarding growth and change over the long
term. It is these analytic intentions that have been passed down to present­
day development research. The handing down has taken place mainly through
three main streams of thinking, with Joseph Schumpeter on the sideline.
THEORETICAL HERITAGE AND ISSUES
INTRODUCTION
22
Adam Smith
(l723-1790)
T.R.Ma~·
\
David Ricardo
(1772-1823)
11766-1834)
~
/&-\\
J. 5. Mill
I
1 "&-I883J
\
J. M. Keynes
(1883-1946)
A. Marshall
(1842-1924)
Karl Marx
J. Schumpeter
(1883-1950)
"'/
Development
economics
Neo-classical
paradigm
Figure
/
_____
Z.J
Neo-Marxist
approaches
Theoretical origins of development economics
With this interpretation, the theoretical family tree can be outlined as shown
in Figure 2.1.
Karl Mar,... (1818-1883) started from the basis of classical political economy,
but transformed this body of theory into a far more comprehensive and
quite different analytic construction. Only a few features of this will be
mentioned here; others will be discussed later in the text in connection with
later presentations of the various Marxist approaches within contemporary
development studies.
At the outset, it should be stressed that the perspective for Marx's theories
was society as a whole and not only the economic processes. Marx was
interested in the totality of society and the ways in which this totality changed
over long periods of time. His focus was on how and why various forms of
society emerged, changed and disappeared to be replaced by new ones. For
Marx, the basic driving forces behind societal changes were the social classes
which, however, acted within structural limits primarily laid down by the
forces of production and the prevailing production relations.
Under capitalism - the most dynamic mode of production in world history
according to Marx - the most important sources of economic growth were
the valorisation and accumulation compulsions which individual capitalists
are subjected to. To achieve a profit, the capitalist must exploit labour by
paying the workers less than the equivalent of the value they produce. This
was a fundamental element in Marx's labour theory of value, which further
assumed that it is the workers and not the capitalists who generate value.
23
In addition to the valorisation compulsion, the capitalist (the individual
factory owner) has continuously to accumulate capital in order to survive in
the competition with others, that is expand his capital apparatus through the
piling up of surplus value generated by the workers (capital concentration),
and through merging with other companies (capital centralisation).
According to Marx, these processes embodied unavoidable tendencies
towards increased technical and organic composition of capital, that is the
continuous enlargement of technical productive assets in relation to labour
and a simultaneous increase of the value of fixed capital in relation to the
surplus value produced by the workers. Combined with population growth,
this necessarily resulted in marginalisation of large segments of the potential
working population and, consequently, the establishment of a large reserve
army of unemployed workers. This was, in a sense, the first formulation of
the hypothesis concerning jobless growth (cf. Chapter 22). For the capital
owners the outlined tendencies meant constant pressure on their rate of
profit, because relatively fewer workers were available for surplus production
as compared with the more rapidly growing capital assets. This tendency,
however, could be neutralised in various ways, including through productivity­
enhancing technical innovations, state interventions, and crises which elim­
inated the least competitive companies.
These basic laws of motion for the political economy under capitalism
could not be viewed in isolation from the class struggle, because a large and
well-organised working class, according to Marx, had the power to lessen the
uncomfortable effects for itself, and in the long run may also be able to
overthrow capitalism and introduce first socialism, and later communism.
On the other hand, a weak working class confronted with a strong and well­
organised bourgeoisie would be forced to put up with miserable conditions.
It is obvious that these summary outlines of Marx's reasoning in no way
do justice to his very comprehensive theory; but the same applies to the
previous discussion of the classical political economists. It should be borne
in mind, therefore, that the intention in the present context is merely to
indicate some of the intellectual sources of inspiration for post-war develop­
ment economics. Readers interested in a more comprehensive introduction
are referred to some of Marx's own presentations (Marx, 1972, especially
vol. I, Chs 21-3; Marx, 18n-~8: pp. 37l-413; Marx, 1969; and Marx, 196~).
Regarding the classical political economists the reader is referred to the major
works cited above, plus a few summary accounts (Hunt, 1989: Ch. 2; Meier
and Seers, 1984).
Joseph Schumpeter (1883-19lo) was mentioned above as a theorist on the
sidelines of the three main streams of thinking; however, this is not to imply
that he has had less influence on development economics. Schumpeter has,
in fact, particularly with his main work, The TheOI)1 of Economic Development
(Schumpeter, 1934; German edition 1912), left a considerable legacy in the
shape of hypotheses and ideas that continue to be debated. There is special
24
INTRODUCTION
reason to mention his explicit distinction between 'growth' and 'development'.
Growth, according to Schum peter, was the gradual extension of the capital
apparatus and increasing production. Here the classical growth theories were
of interest. However, in contrast to these, Schumpeter asserted that develop­
ment could occur only when technical innovations introduced new production
techniques, new products, or new means of organising production - in other
words when the production factors were utilised in new ways. In this manner,
more fundamental changes would be brought about and new rules of play
introduced into economic life.
The innovators, in Schumpeter's conception, were the entrepreneurs, who
as a category covered more than the industrialists or capitalists, and who,
furthermore, did not themselves need to be capitalists. Schumpeter also
broke ranks with the classical conception of capitalist savings and accumula­
tion as being the most important sources of growth. He believed instead
that growth was driven by technical innovations, in association with the
entrepreneurs' mobilisation of credit in the economic system as a whole
(Schurnpeter, 1934).
Several changes in the focus of economists preceded Schumpeter's con­
tributions, especially changes away from a primary interest in growth and
growth-determining conditions, and towards equilibrium analyses. Around
the turn of the twentieth century, long-term growth was taken for granted
and consequently attention was shifted to how to achieve the best possible
utilisation of given resources - known as allocative effectiveness and ef­
ficiency. This implied the arrival of the so-called neo-classical paradigm ­
and here the Kuhnian term 'paradigm' is more appropriate than in relation
to most of the rest of the social sciences, because these neo-classicists really
did, and continue to, elaborate a consistent and highly formalised (and
mathematically formulated) theory with common assumptions, concepts and
rules of validation. It is this neo-classical paradigm that today dominates a
very significant proportion of economic research in both the industrialised
countries and in many developing countries.
One of the first great theorists within the paradigm was .Alfred Marshall
(1842-1924) whose major work, Principles 0/ Economics, first published in 1890,
came to replace Mills's Principles of Political Economy as the most important
standard work within mainstream economics.
We do not delve into the paradigm here. Rather the reader is referred to
the discussion of the neo-classical contributions to development research in
subsequent. chapters (particularly Chapters j and 18), in addition to a few
major works and text books (Walras, 19j4; Samuelson, 1967 or later editions).
However, a brief note may be useful at this point: some of the central
features of neo-classical economics are certain explicit assumptions about
the nature of the economic system and the determinants of economic
behaviour. These assumptions include one which stipulates that firms will
maximise profits. Another assumption is that consumers will maximise utility.
THEORETICAL HERITAGE AND ISSUES
2'
Combined, these behaviour-determining factors are believed to produce an
optimal allocation of production factors and, further, provide the best
conditions for economic growth - provided that perfectly competitive markets
exist. Price distortions as a consequence of political interference with the
market mechanisms will therefore inhibit economic growth.
Before we leave the historical roots of development economics we shall
briefly touch on the role that John M'!Ynard Keynes (1883-1946) has played.
Keynes, who wrote his main contributions during the 1930s, including The
General Theory 0/Empl'!Yment, Interest and Monry (1936), was, like the mainstream
economists, not particularly interested in long-term growth or in conditions
in the colonies. This is why he clid not leave behind any elaborate theory of
growth and development. On the other hand, he placed the question of the
relationship between market and state so firmly on the agenda that he thereby
acquired lasting significance for the ensuing development debate (see Toye,
1987: Ch. 2 for an excellent discussion of this).
Probably Keynes's most significant contribution to theory formation and
debate concerned the question of the reasons for, and the possible solutions
to, the unemployment problem. But he also left behind an important legacy
with his analyses and propositions regarding institutional control of inter­
national trade and finance, and the associated proposal for establishing what
was later to become the International Monetary Fund and the World Bank.
Furthermore, Keynes achieved a considerable indirect influence on develop­
ment strategies through the work of two other economists, Roy Harrod and
Evsey Domar, after whom the so-called Harrod-Domar model was named.
This model informed the entire way of thinking about economic planning in
the Third World during both the 19jOS and 1960s (cf Chapter 16).
After this brief survey of the intellectual roots of development economics,
we can turn our attention to the theoretical legacy which has exerted a
strong influence on sociological and political development theories.
Theoretical origins of sociological and
political development theories
Sociologists normally trace the origins of their discipline back to the French
author Auguste Comte (1789-1817), who was also the first to use the term
'sociology'. However, more comprehensive contributions to theory con­
struction appeared later - from Emile Durkheim (18j8-1917), Karl Marx
and Max Weber (1864-1920). Each of these three theorists can be said to
have founded a major school of thought with considerable impact upon
different approaches within contemporary development studies.
Emile Durkheim acknowledged explicitly Comte's contribution to estab­
lishing sociology as a scientific discipline, but asserted that Cornte had not
successfully achieved his objective. Durkheim wished to complete the work
in accordance with a natural science model, which meant among other things
26
-,
INTRODUCTION
that he would study social phenomena as 'objects' - as if they were as
palpable as natural phenomena.
Similar to the classical political economists, Durkheim was concerned with
social change processes in the long term. This led him to study the develop­
ment of the division of labour in sociery as part of the industrialisation
process. Where economists concerned themselves with the impact that the
division of labour had upon growth, it was more important for Durkheim
to study its social consequences. Durkheim believed that the division of
labour would eventually come to replace religion as the most important
social force of cohesion, but that the separation and specialisation of labour
functions and other swift social changes would also cause widespread anomie.
By 'anomie', Durkheim meant a feeling of rootlessness and aimlessness which,
furthermore, was characterised by a lack of moral guidelines. The breakdown
of the traditional orders, which were supported by religion, would result in
many people feeling that their lives had lost meaning; they would feel isolated
without clear guidelines for normal behaviour.
Durkheim's approach in these areas has clearly influenced post-war
modernisation theory (cf. Chapter 12). His reasoning around the concept of
anomie is found also in other contemporary approaches like those applied to
the study of ethnic and religious revivalism as responses to the breakdown
of traditional order (cf Chapter 23).
Durkheim also engaged himself thoroughly with the causes of suicide.
He researched the causes of suicide, not by looking at the individual's
motivation but by looking at the external social circumstances in which suicide
occurred with a markedly higher frequency. The method of analysing in­
dividual behaviour as determined significantly by social circumstances came
to influence the further development of sociological methods.
The theoretical heritage from Durkheim was transmitted through at least
three main streams. The first one was via the founders of modern social
anthropology, including particularly A. R. Radcliffe-Brown (1881-1911) and
Bronislaw MalinOlvski (1884-1942), who were both pioneers in the evolution
of fieldwork methods with well-defined conceptual frameworks. The further
development of these methods led to the present functionalist analysis at the
micro level, that is analyses based on the view that social conditions and
events in the local community are best understood and explained on the
basis of their function - with reference to the part that they play for the
local community and its maintenance. The second stream went more directly
or through lesser known theorists and researchers to functionalism and
modernisation theory with a macro perspective. The third stream went via
Talcott Parsons (see below).
Karl Mar:>/s contribution to theory formation in relation to the political
economy of capitalism has already been briefly mentioned. Here we shall
add only a few more observations regarding his role in the context of
sociological method and theory. Marx is the only one among the founding
f
THEORETICAL HERITAGE AND ISSUES
27
fathers of modern social science who has left a strong impact upon both
development economics and sociological and political science approaches to
the study of Third World development.
Even though in terms of volume Marx wrote much more about the
political economy of capitalism, his analytic perspective and method at the
same time implied substantial contributions to sociology. As earlier mentioned,
Marx's perspective embraced the whole of society. His method implied a
systematic tracing of the interactions between the basic economic structures
and processes on the one hand, and the political, social and ideological
relations and institutions on the other. Marx, in his analyses, assigned to the
economic processes a certain precedence over other societal processes,
believing that social change was prompted primarily by economic influences.
The dynamism created by technological progress and the development of
the forces of production within the framework of a particular mode of
production would, in the final instance, also determine the direction and
basic patterns of societal changes in the social and political spheres. This
was part of the basic idea in his materialist conception of society and history.
However, it is important to add that the primacy of economics applied only
in the long-time perspective and at the macro level. Further, it is important
to note that the class struggle under all circumstances impacted heavily upon
actual outcomes and thus mediated, to some extent shaped, impeded, or
accentuated economic determination of structural change processes. But
underlying all reservations and complicating circumstances, Marx had a clear
idea about technological progress and development of the forces of produc­
tion as constituting the core of the dynamic that changed societies. He also
held the view that social and political conflicts which really mattered all had
• their roots in economic inequaliry and economic conflicts of interest. This
meant, with regard to the methods for the investigation of sociery, that the
researcher should always try to identify the economic-material basis for other
social phenomena and further expect, a priori, that the basic structures were
far more important to the outcome of social and political processes than
people's motivations and wishes.
With respect to both these fundamental notions, Max weber advanced
opposing views. He would not, a priori, assign to the economic processes any
primacy at all, but on the other hand would not exclude that they could, under
certain circumstances, determine the outcome of the social and political
processes. In his works, Weber did not explicitly polemicise against Marx, who
he apparently had deep respect for as a theorist, but went indirectly against
him, for example in his famous book about the Protestant ethic, in which he
asserted the critical importance of Calvinism for the breakthrough of capital­
ism in Western Europe (Weber, 1961). This was like turning Marx on his head,
at least as seen from a simple interpretation of Marx. A more thorough
comparison of the rwo theoretical giants within social science research shows,
however, that it is somewhat more complicated (Martinussen, 1994).
28
INTRODUCTION
THEORETICAL HERITAGE AND ISSUES
Regarding the relationship between structure and the individual actor, there
is a stronger case for contrasting Marx and Weber. There is no consensus on
exactly howmuch of individual behaviour the structures accounted for, accord­
ing to Marx. However, there is general agreement that Weber in this respect
assigned to man as an individual significantly more independence in society.
Therefore, Weber also worked much more than Marx with human motivation
and rationality as determinants of behaviour as well as outcomes of social
conflicts and other processes
Weber has sometimes been taken to task, wrongly, for simple assumptions
about rationality as something unequivocal. In reality, Weber worked with
many types of rationality, of which the so-called bureaucratic rationality
(which actually combined two forms) was only one among several (Bruun,
1972: pp. 221 ff.). This was the form of rationality that Weber described as
the analytical ideal type in his studies of modern bureaucracy. His approach
in this regard did not imply support for bureaucracy and its rationality as an
unconditional asset. Weber found bureaucracy unavoidable in a modern
capitalist society. He also found this form of organisation and the associated
bureaucratic forms of behaviour useful for solving many societal problems.
But Weber emphasised strongly that a bureaucratic system which was not
subject to democratic control or counterbalanced by charismatic or otherwise
popular leaders, was an evil for society.
Where Durkheim focused primarily on the division of labour as an
integrated part of industrialisation processes, Weber's main interest was to
describe, interpret and explain the emergence of the bureaucratic form of
organisation and the related rationality form. These rwo phenomena Weber
viewed not just as dependent variables, but also as independent variables, in
the sense that the modes of organisation and rationality, after being engrafted
upon modern societies, seemed to act as driving forces for subsequent social
change processes. It was in this context that Weber deemed it desirable to
have some form of popular influence and control over bureaucracy.
In addition to Weber's substantial contributions to social science theory
building, he also laid the foundations for the methodological principle which
is now known as scientific vallie relativism. This principle takes as its starting
point that there is a logical gap between 'is' and 'ought' - berween society,
as it exists, and society, as the researcher would like' it to be. According to
Weber, it was not possible to conduct value-free research. Normative elements
would affect all stages in the research process, from choice of themes and
methods through collection and interpretation of data to formulation of
generalisations and theories. The researcher could, however - and should in
the role of researcher - always try to reduce biases, that is the hidden and
therefore manipulating influences from his or her own norms and values, by
presenting these as explicitly as possible. This would allow other researchers
to evaluate and re-test the research undertaken and its results.
Value relativism was brought into development research primarily by
Gunnar Myrdal (d. Myrdal, 1959; Myrdal, 1968: Ch. 2) and Paul Strcctcn,
but otherwise it has, unfortunately, never achieved recognition as a central
methodological principle (d. Chapter 25).
Other aspects and elements of Weber's method and theory have been
passed down through many channels, but often without the same explicit
reference to Weber as is found with respect to Marx within the historical­
materialist tradition. Some of the explanations for this could be that another
dominant, though less sophisticated, theorist of the twentieth century, Talcott
Parson! (19°2-1979), was instrumental in bringing Weber to the English­
speaking world. Parsons reduced Weber's complex and open theory to
functionalism, into which he also adopted elements from Durkheim. It was
a characteristic of Parsons that he found Weber and Marx totally incompatible
as theorists, even in the sense that Weber could essentially replace Marx,
who had thus become superfluous (Parsons, 1937). This interpretation was
adopted by the modernisation theorists in the 19 JOS and can be found even
today among many development researchers, especially in the English-speaking
parts of the world.
However, other conceptions of the relationship between Marx and Weber
do exist in the literature. Schumpeter, for example, suggested in the 1940S
that the two theorists supplemented each other - that there were a number
of areas where they were compatible (Schumpeter, 1947). In recent years,
this interpretation has gained ground among development researchers who
label themselves as Neo-Weberians or Post-Marxists, The latter conceive of
themselves as more authentic inheritors of Marxian theory and method than
the so-called Nco-Marxists (d. Vandergeest and Buttcl, 1988; Corbridge,
1990).
A simplified overview of the intellectual roots of contemporary socio­
logical development research can be summarised as in Figure 2.2. To this
should be added that within social anthropology there is a particular
structuralist approach, and an approach which is sometimes termed 'symbolic
interactionism'. Structuralism traces its roots back primarily to Ferdinand de
Saussure (1857-1913); symbolic interactionism to George Herbert Mead (1863­
1931) (for a concise overview, see Giddens, 1989: Ch, 22).
The sociological family tree depicted in Figure 2.2 may also be seen as an
overview of the roots of political development theory, although the political
science approaches in the post-war period increasingly separated themselves
from sociology, developing their own schools of thought. Within the
dominant non-Marxist tradition one could identify at least rwo important
approaches: behaviouralism and functionalism, the latter with branches of an
institutionalist-structuralist approach.
Behaviouralism focused on individual political behaviour and endeavoured
through cross-national studies, which frequently included industrialised
countries, to uncover general behavioural patterns and establish general
explanations. Here the inspiration from Durkheim was obvious, even though
29
THEORETICAL HERITAGE AND ISSUES
INTRODUCTION
3°
Auguste Comte
(1789-1857)
-:
"
Emile Durkheim
\1858-19171
Karl Marx
(1818-1883)
Max Weber
(1864-1920)
/~/I
Talcott Parsons
(1902-1979)
Radcliffe-Brown
(1881-1955)
B. Malinowski
(1884-1942)
Functionalism and
modernisation
Functionalism and
anthropological
field methods
Figure
theory
2.2
Post-Marxist
Theoretical origins of sociological and political
development theories
the more sophisticated analyses implied considerable refinements In com­
parison to his (e.g. Lerner, 195 8).
Functionalism and the institutionalist-structuralist approach were more
preoccupied with political macro-phenomena such as the apparatus of govern­
ment, political parties, interest organisations, and mass media. The pertinent
questions in many of the studies within these schools centred around the
functions and structures necessary for the persistence and modernisation of
a given political system. In this case, the theoretical origins could be traced
back to, on the one hand, sociological functionalism or structural-functionalist
analysis and, on the other hand, to the legal disciplines and particularly their
studies of the interrelationships between political institutions.
Major controversial issues in development research
Based on the above outlines of the theoretical heritage and by taking into
account later theoretical development debates, we can now formulate some
of the central and controversial questions that have dominated much of the
theoretical discussions. The selection of issues in the present context in no
way covers the whole area of development research. Other critical issues will
have to be added and considered later in this book. But the questions and
3I
the competing answers given to each of them, we believe, do provide a fairly
comprehensive introduction to several of the overriding issues discussed
throughout the. book.
Some of the questions in Table z. I relate to perspective and method or
are directed at implied or explicitly stated assumptions. Other questions probe
into the substance and look at opposing conceptions of, and theories about,
what is happening in the Third World and how it can be explained. A final
type of questions concerns the choice of development strategy.
Common to all the questions and answers listed in the table is that they
are stated in very general and vague terms. More precise formulations can be
given only when we have introduced the specific terms used in the various
analytic frameworks which are presented later in the book. Further, it should
be noted that Table ~.1 as a whole is biased in favour of economic issues.
This bias will be corrected gradually as we proceed from economic analyses
and theories in the second part of the book to other approaches, reviewed
in subsequent parts, which give more attention to political, social, and cultural
aspects.
To provide clarity, the presentation is stylised and formally standardised
with the issues in the extreme left column, and possible answers in the two
other columns. It can be seen immediately that the possible answers in most
cases represent extreme positions, with several possible alternatives in be­
tween. In a few cases, additional, interrelated answers are given in the same
cell. It should be stressed that there is no logical or other compelling
correlation between the answers when read vertically.
It should be further added that there is a third, qualitatively different,
answer to the strategy question on how to achieve the best possible utilisation
of resources, which is to leave it, as far as possible, to the citizens themselves
- to civil society and its institutions.
One of the most controversial questions is not included in the table,
namely the question concerning what should be understood by development.
This question is taken up in the next chapter, which will reveal a multitude
of qualitatively different and competing answers.
"..r-t.......... ...... . . . ;.." -.. '" ....
INTRODUCTION
F
Table
2.1
~
THEORETICAL HERITAGE AND ISSUES
Controversial issues in development research
Table
2.1
B
Cont.
Hypothms andtheory (COllI.)
Perspective and method
Which perspective facili­
tates the best analyses?
1\ macro perspective ­
within a macro-theoretical
framework of analysis
1\ micro-analytic per­
spective - or a mezzo­
analytic perspective
Which conception of
society provides for the
best analyses?
1\ consensus conception ­
assuming a genuinely
common national interest
1\ conflict conception­
assuming conflicts between
opposing interests
Which method will give the
best and most robust
results?
Formalised mathematical
model analyses
Qualitative method
Hypothetical-deductive
method
I nductive method
Which unit of analysis will
provide for the best
results?
Individual actors ­
assuming that their actions
are important for
determining structures
and outcomes
Structures and institutions
-' assuming that they are
important determinants of
behaviour
Historical method
Does a highly inter­
ventionist state promote
development?
No
Yes
Which economic sector is
the most dynamic?
The industrial sector
The agricultural sector
What is the relationship
between technological/
economic changes and
other aspects of societal
transformation?
Technological/economic
changes determine other
aspects of societal
transformation
A dialectic relationship
where political and cultural
institutions shape
technological/economic
changes
Which regime form is the
most appropriate for Third
World development?
Democracy - with a multi­ Authoritarian regimes
party system and universal which can ensure national
adult franchise
co-ordination and long­
term planning
Whar role is played by civil
society and irs institutions?
Civil society traditions and Civil society embodies its
institutions restrain
own dynamism which
growth and modernisation provides the basis for
survival for many citizens
Hypotheses and theory
How does societal develop­ Through a linear process ­
ment take place?
as a continuous evolution
or in stages
Through a non-linear
process
Do Third World countries
follow the same path of
development as the
industrialised countries?
No - that is not assumed
unless rendered probable
Yes - that is assumed until
disproved
What has been the primary Progress and societal
impact of colonialism and
development
imperialism upon the Third
World?
Underdevelopment or
maldevelopment
Obstruction of develop­
ment
Does free trade benefit
developing countries?
Yes
Nu
Do close links with the
world market promote
development?
Yes
No
Can the state act
autonomously?
Yes
No - state actions and
interventions are curtailed
by prevailing economic
structures and the most
powerful interests
JirakiJ'
How is the best utilisation
of resources achieved?
By leaving the allocation
primarily to market
mechanisms
By leaving the allocation
primarily to the state
Which economic sector
should be given the lead
role in development?
The industrial sector - and
resources should be
transferred to this sector
from the rest of the
economy
The agricultural sector ­
and resources should be
transferred to this sector
from the rest of the
economy
Which actors would it be
best to rely on for
promoting socio-economic
development?
Private companies and
entrepreneurs
The state - central
government and/or local
authorities
What is the best growth
strategy in an international
context?
(Citizens and their
community organisations)
An outward-oriented,
export-led growth strategy
- with a liberal foreign
trade regime
An inward-oriented,
import-substituting strategy
- with protection of the
domestic market